WASHINGTON — An executive order by the new governor of Alaska halting discretionary spending at the state’s spaceport will not stop its ongoing repairs but could affect other activities there, spaceport officials said.
Alaska Gov. Bill Walker, a Republican, issued an administrative order Dec. 26 that directed state agencies to halt work “to the maximum extent possible” on six public works projects, including the state-owned Kodiak Launch Complex.
Walker, who took office Dec. 1, issued the order in response to projected budget deficits linked to falling oil prices, which contribute most of the state’s revenue. The price of Alaskan crude oil, which was more than $100 per barrel as recently as late August, fell to just $56 per barrel by Dec. 30.
“Our budget deficit grows deeper as oil prices go lower,” Walker said in a Dec. 26 statement accompanying the order. “These are large projects that require significantly more state investment to complete. I’ve requested that state agencies not enter into any new contracts until we’ve had a chance to look at the various projects.”
The order requires the affected projects, including the Kodiak Launch Complex, to immediately cease all discretionary spending and not incur new expenses. The order, though, does allow “contractually required spending” and payment of salaries to continue.
In a statement provided to SpaceNews Dec. 31, Alaska Aerospace Corp. President and CEO Craig Campbell said the order will not affect ongoing repairs to a launch pad at Kodiak damaged in a failed test of the U.S. Army’s Advanced Hypersonic Weapon in August. Those repairs, he said, are being paid from a state insurance policy.
“Work continues on the cleanup of the Kodiak Launch Complex under existing contracts, but [Alaska Aerospace Corp.] will not be issuing new contracts until after discussing with the governor’s staff,” Campbell said in the statement. The order, he added, should not delay the completion of repairs to the site, scheduled for October.
On Dec. 12, Alaska Aerospace Corp. announced an agreement with Lockheed Martin to upgrade the Kodiak launch pad to support launches of the company’s Athena 2S medium-lift vehicle. Those upgrades, estimated to cost $3 million to $5 million, will be paid from state funding appropriated in 2012.
Campbell did not indicate if that agreement will be affected by the governor’s order. “We are evaluating the impact of the administrative order to pending and potential launch contracts with our commercial, U.S. government, and international customers,” he said.
The potential tightening of state funds comes just after the state spaceport won funding from the federal government. The 2015 omnibus spending bill signed into law Dec. 16 by President Barack Obama included $6 million in a line item called “space launch range services and capability” intended to support state-owned spaceports used by federal government agencies.
In a Dec. 18 statement, Alaska Aerospace Corp. announced it was receiving $3 million from that fund, which Campbell later said would be used for “operations and sustainment” of Kodiak Launch Complex. “Now we can match the Air Force cost structure and give the customer a guaranteed launch window,” he said in the statement.
Campbell said Alaska Aerospace Corp. officials planned to meet with the state’s budget office Jan. 2 to discuss their plans. “That meeting will likely shape the future budget decisions [the budget office] will put forward for Governor Walker’s final decision to present to the Alaska Legislature,” he said.
